BLOG:  Digital Financial Reporting

This is a blog for information relating to digital financial reporting.  It is for innovators and early adopters who are ushering in a new era of digital financial reporting.

Much of the information contained in this blog is summarized, condensed, better organized and articulated in my book XBRL for Dummies and in the three documents on this digital financial reporting page.

JOA: Real talk about artificial intelligence and blockchain

The Journal of Accountancy, the trade magazine of certified public accountants, published the article Real talk about artificial intelligence and blockchain this month.  Here is on excerpt from that article:

"Technology is poised to transform the accounting profession. Artificial intelligence, robotics, and blockchain are on the verge of automating many traditional core CPA tasks. The profession is at a critical moment, one from which it will emerge in a far different form."

Like I have said, this stuff is going main stream.  One of the panelists sort of makes the right connection between AI and XBRL, but not that clearly.

Clearly I agree with the Journal of Accountancy.  I published a similar article a few days earlier, Accounting and Auditing in the Digital Age.  My article goes into more detail and makes the role XBRL plays in this paradigm shift more clear.  I also explain what CPAs should be doing now to stay on top of these changes.

Posted on Wednesday, July 5, 2017 at 11:15AM by Registered CommenterCharlie in | CommentsPost a Comment | EmailEmail | PrintPrint

Revised Digital Financial Reporting Manifesto

 I have made some revisions to my Digital Financial Reporting Manifesto.  I tried to simplify the document, fixed some typos, and updated a few things.

This Digital Financial Reporting Manifesto  is intended to help professional accountants and other business professionals to contemplate, discuss, otherwise think about, and ultimately understand why and that an option should exist to express a general purpose financial report digitally.  We need digital financial reports to do accounting and auditing in the digital age.

Posted on Monday, July 3, 2017 at 10:27AM by Registered CommenterCharlie | CommentsPost a Comment | References1 Reference | EmailEmail | PrintPrint

Accounting and Auditing in the Digital Age

In the document Accounting and Auditing in the Digital Age, I try and explain, as succinctly as I possibly can, how three primary enabling technologies will help the medieval tradition of accounting evolve to meet the new operating needs of businesses large and small.  Here is the executive summary:

  • The fourth industrial revolution is occurring which is enabling businesses to operate in significantly different ways; enabling technologies include artificial intelligence, internetworked physical devices, cyber-physical systems, nanotechnology, and biotechnology.
  • Professional accountants and accounting practices, procedures, and processes will need to adapt. Education and training of professional accountants also needs to adapt.
  • Humans augmented by machine capabilities, much like an electronic calculator enabling a human to do math quicker, will empower knowledge workers who know how to leverage the use of those machines.
  • Three primary enabling technological innovations are driving this significant change to the current accounting practices, processes, and methods: XBRL-based structured digital financial reports, knowledge-based systems and other application of artificial intelligence, and blockchain-based distributed ledgers.
  • While it is difficult to precisely predict the productivity gains which will be realized, initial information is showing the productivity gains will be very, very significant.

 Please let me know how I did or if you have ideas for improving this document.

Posted on Wednesday, June 28, 2017 at 04:31PM by Registered CommenterCharlie in | CommentsPost a Comment | EmailEmail | PrintPrint

Commentary Linkbase for IFRS-FULL

I created a commentary linkbase for US GAAP a while back.  I started a similar commentary linkbase resource for IFRS-FULL

(I am doing that as part of my template creation exercise for IFRS which will expand my expert system to that reporting scheme.)

What something like the commentary linkbase does is allow you to add helpful commentary or other guidance or explanations to an XBRL taxonomy.  It is just a label linkbase that uses a specific label role.  You can see how the commentary shows up in a software tool in this graphic.

How much coding was required to get software to support this feature? Zero.  Comes with XBRL; if software developers created their software correctly.

This XBRL instance makes use of the commentary linkbase.  It also has a bunch of different labels, another very useful feature of XBRL. (Here is a screenshot of that.)

Imagine all the other documentation you could provide to make taxonomies even more useful!  Got any ideas?  Let me know.

 

Posted on Thursday, June 22, 2017 at 01:03PM by Registered CommenterCharlie in | CommentsPost a Comment | EmailEmail | PrintPrint

What the future of artificial intelligence in government?

An article, What the future of artificial intelligence in government?, which is based on a study by Dr. Peter Viechnicki, William D. Eggers states the following:

At the high end, we estimate within the next 5-7 years, as many as 1.1 billion working hours could be freed up in the federal government every year, saving a whopping $37 billion annually. Ultimately, AI could potentially free up 30 percent of federal employees' time. State government savings in time and money could be similar percentages.

The study, How much time and money can AI save government?, is worth reading.  The study measured what government employees do at a task level.  One of the more interesting things is information about the US Geological Survey, the folks that make maps.  Here is that section:

How cartography went digital

The US Geological Survey (USGS) began producing topographic maps of the nation in 1879 and for most of its history, it printed its maps on paper. If you were an active hiker or camper in the 1980s, you’ll likely remember shelves and shelves of USGS topo maps at outdoor stores, but over the following decade, USGS transformed its mapmaking techniques by embracing digital map production. This transformation, which relied on a major Reagan-era investment in geospatial information systems technology, was disruptive and productive. It significantly improved the efficiency of production—and completely changed the nature of cartographers’ jobs.

Before the transformation, USGS cartographers worked as skilled craftsmen, performing painstaking tasks such as drawing elevation contours on acetate sheets. Today, their duties primarily involve collecting and disseminating digital cartographic data through the National Map program.

Today, USGS officials recall a bumpy transformation. Veteran cartographer Laurence Moore says, “We were slow to appreciate how fundamentally GPS and digital map data would change the world, and tended to think of these technologies as just tools to produce traditional maps faster and cheaper.”

Today, the agency employs only a tenth of the cartographers working there at the peak of the paper-map production era. But paradoxically, the total number of cartographers and photogrammetrists employed by federal, state, and local governments has risen by 84 percent since 1999. And the Bureau of Labor Statistics forecasts a 29 percent growth in employment for cartographers and photogrammetrists through 2024, largely due to “increasing use of maps for government planning.”

The article and the study help professional accountants wrap their heads around what is about to happen to them.

Posted on Friday, June 9, 2017 at 02:41PM by Registered CommenterCharlie in | CommentsPost a Comment | References4 References | EmailEmail | PrintPrint